As climate change is expected to have a devastating impact on New Zealand properties, Local Government New Zealand (LGNZ) is pushing for a “fundamental rethink” on climate risk frameworks.
Malcolm Alexander, chief executive at LGNZ, explained at the Climate Change and Business Conference last week that the country is full of seaside communities – emphasising the importance of investing in creating long-term resilience to greater potential risks arising from climate change.
“It’s good we’re talking about adaptation. It’s about time we did a lot more of that because ‘stuff’ is coming whatever else happens. Stuff is going to come whatever we do and we need to accept that reality,” Alexander told delegates during a session on the risks and challenges that councils face to address climate risks.
Alexander acknowledged that the insurance sector is moving from generalised to granular risk-based pricing as climate change worsens.
“Risk-based insurance pricing is already a reality for councils, yet Crown funding arrangements for the replacement of public assets damaged by natural events encourages like-for-like replacement instead of building in more resilience over time,” he said.
“Councils need to be able to gather information on the changing potential risks their communities and assets face, and demonstrate to insurers they are managing those risks.”
He added that councils must share information with their communities to help home buyers become more aware of the risks that they could face when choosing where to live.
“We’ve got enough information here to start making decisions from an investment and incentive point of view. People have got to start owning and managing risk and not looking for someone to pass the buck to,” Alexander concluded.
